Category Archives: Health Care

The Ballad Merger V: the Pandemic

Ballad Health nursing promotion

by Carol J. Bova

The nursing shortage was a top issue for Ballad Health from the moment the health system was created in 2018 from a merger of Mountain States Health Alliance and Wellmont Health System. The new health system, which served far Southwest Virginia and neighboring parts of Tennessee, laid out a plan in its first annual report to tackle the burgeoning workforce crisis that was afflicting much of rural and small-town America.

The annual report noted the following initiatives:

  • Putting $10 million annually into increasing nursing wages which affects one-third of [the] work force. The first two classes of the ETSU/Holston Valley accelerated BSN program graduated in May and August, 2018, producing a net gain of 34 additional nurse graduates above previous program capacity.
  • Contracting with Northeast State Community College (NESCC) for admission of 20 additional associate degree nursing students each spring semester starting January, 2019. … This provides an additional 20 new graduate nurses annually above current capacity at NESCC program.”

These measures were clearly stop-gap. First, while the $10 million annual increase to nursing wages might have helped retain nurses, it did nothing to train or recruit new nurses. Second, educating 52 new nurses (only 34 in Virginia) over two years was a positive but only a fraction of the number needed— even assuming they all wound up working for Ballad. Continue reading

Ballad Merger IV: Has Quality Improved?

Ballad Health signage at Lonesome Pine Hospital. Photo credit: WCB

by Carol J. Bova

As a condition of the merger between Mountain States Health Alliance and Wellmont Health System in 2018, the combined entity, Ballad Health System is required to periodically update Virginia regulators on health metrics for its far Southwest Virginia service territory. Those quality measures and actual performance must be accessible to the public on the Ballad website as well.

The reporting was suspended during the COVID-19 emergency before year-to-year comparisons for Fiscal Year 2020 were available. But Ballad did publish an Annual Report for Fiscal Year 2020 that contained partial data through February 2020.

The bottom line: Quality measures have been a mixed bag. Some measures have improved; a few have declined. As detailed in Parts II and III of this series, Ballad met expectations for cost cutting and restructuring. What isn’t clear from the limited data available is why there is “slippage” in some numbers from one year to the next. Important questions arise. Continue reading

The Ballad Merger III: Reshuffling, Reconstruction and Repurposing

Norton Community Hospital

by  Carol J. Bova

When Mountain States Health Alliance and Wellmont Health System merged to create Ballad Health in 2018, the healthcare companies justified the consolidation with the argument that the ability to cut costs and rationalize delivery of health services would yield tangible benefits to patients in Southwest Virginia and Northeastern Tennessee.

The previous article in this series, “Cuts and Consolidations,” detailed how  Ballad Health bolstered finances through shared value-based payment savings, bond refinancing, staff reductions and closures of off-site facilities. This article, Part III, shows how the company acted to lower costs and enhance revenue by consolidating medical services, repurposing hospitals, introducing telemedicine, and implementing a new IT system.

The Virginia Cooperative Agreement, which outlined the requirements of Virginia regulators, allowed repurposing as long as certain “essential services” were retained. Deploying telemedicine and rotating specialty clinics in rural hospitals would help it meet the requirement. Continue reading

The Ballad Merger II: Cuts and Consolidations

by Carol J. Bova

Upon the merger of Mountain States Health Alliance and Wellmont Health System in 2018, the first order of business for the newly created Ballad Health was shoring up its finances. If Ballad wasn’t successful at this, it would not have the resources to invest in the new services, facilities, programs, and equipment to improve community health it had promised as a condition of the merger.

Not all of Ballad’s actions were well-received. Some changes triggered community protests and county objections in its Tennessee and Virginia service territories. But the company did achieve its aim of bolstering cash flow. Here’s how Ballad went about it.

Job cuts. Financial conditions were adverse from the beginning. In an April 16, 2018 letter to the Tennessee Commissioner of Health, ten weeks into the merger, Ballad wrote that “due to the increased cost of labor, pharmaceuticals and supplies, and the continued shift to the outpatient setting from inpatient, operating income of the combined systems has declined by 123% since the same time in the prior year.” Continue reading

The Ballad Merger — A Leap of Faith by Two States

Ballad Health hospital market area in Tennessee and Virginia

by Carol J. Bova

In April, 2015, two Tennessee-based not-for-profit hospital organizations with a 75% market share in Southwest Virginia said a merger would allow them “to address the serious health issues affecting the region and to be among the best in the nation in terms of quality, affordability and patient satisfaction.” The merger  would involve 21 hospitals in 21 counties in two states, and about 960,000 people.

The FTC opposed the merger. The commission said that courts and antitrust agencies view an increase of more than 200 points on a standard measure of market concentration — the Herfindahl-Hirschman Index (HHI) — as likely to be anticompetitive. The new company’s post-merger score would increase 2,441 points.

In the hope that this merged company might solve overwhelming regional health disparities, Virginia and Tennessee ignored the FTC and took a leap of faith. Both states passed legislation to allow cooperative agreements for a merger of the two systems. To confer immunity from federal and state antitrust laws, the legislation provided for state regulation and active supervision to ensure that the benefits would outweigh any disadvantages. Continue reading

Virginia Hospitals Rank High in Safety

Source: Leapfrog Hospital Safety Grade

Half of all Virginia acute-care hospitals scored a “safety rating” of A, the fourth highest percentage of the 50 states, according to the latest Leapfrog Hospital Safety Grade rating.

Leapfrog bases the rating on 27 performance measures, some developed by the Centers for Medicare & Medicaid Services (CMS) and some from supplemental data sources. These include process measures such as, how long it takes staff members to respond when patients ask for help; structural measures, such as whether hospitals use computerized systems to prevent errors in administering medications; and outcome measures, such as how often surgeons leave foreign objects like sponges or tools in a patient’s body.

The survey encompasses 2,700 hospitals nationally. Massachusetts sets the national standard in 2021, with 58.6% of hospitals scoring A. North and South Dakota hit bottom with zero hospitals making the grade.

Here follows a list of Leapfrog’s Virginia hospital ratings (in alphabetical order within each grade cluster): Continue reading

Chesapeake Regional Medical Center Sues Sentara – Again

by James C. Sherlock

A tip of the hat to my friends at Checks and Balances Project for alerting us to a new civil suit filed April 27 against Sentara by Chesapeake Regional Medical Center (CRMC).

I will comment on Sentara’s response to the suit when it is available.

The complaint alleges various instances of tortious interference by Sentara with CRMC’s business and conspiracy to do the same. I recommend you read the complaint as filed. It is quite a story.

Although I am familiar with only part of the evidence in this specific case, that being Sentara’s successful intervention against CRMC’s COPN application for open heart surgery, the other allegations match decades of Sentara business practices.

Continue reading

End the Emergency Orders. Now. Every One.

Governor Ralph Northam Signals His Virtue

by Steve Haner

There is no more COVID emergency. Every single emergency order issued by Virginia’s Governor Ralph Northam should be lifted immediately. Not relaxed or revised, ended.

For the millions of Virginians now vaccinated, this is all just virtue signaling, “pandemic theater.” For the millions of Virginians who have made conscious decisions not to get the vaccine, my level of concern for them has evaporated. They, their families, and their health care providers are on their own, and, frankly, most will be fine until winter stimulates the virus again.

More Virtue Signaling

By then, more of them will have come to their senses and gotten the shots.

The rules in place are really starting to look stupid.  President Joe Biden, Governor Northam and all the others holding onto and consciously modeling needless restrictions are the real anti-vaxxers now. They are the ones clearly rejecting all the scientific evidence of vaccine effectiveness.  Continue reading

Hospitals 1, Patients 0

by James C. Sherlock

Since January 1 of this year, after a court battle won in late December 2020 by the Trump Justice Department, the Centers for Medicare/Medicaid Services (CMS) has required hospitals to post median payer-specific negotiated rates.

I figured the fix was in when most hospitals in Virginia still haven’t complied. The Virginia Department of Health’s vhi.org data contractor could have done it for all of them with data it already collects.

Sure enough, on April 27, the Biden administration’s CMS proposed repealing the transparency requirement. The elimination of this rule will be the latest casualty of the political power of the hospitals, especially with Democratic politicians. Continue reading

Open Letter to the Sentara Community

Sentara RMH Medical Center

by Dr. Robert H. Sease

As a lifelong resident of Harrisonburg, a retired physician and  a volunteer hospital chaplain, I feel compelled to write about the current and ongoing situation at our local hospital. My father, my two uncles, my brother and myself have a combined 180 years of medical service to this community, so I have a genuine vested interest in the welfare of our local hospital and the community it was designed to serve.

Historically, for a small community hospital, we have been blessed to have phenomenal medical care. It’s a well recognized fact that the Shenandoah Valley has some of the lowest insurance reimbursement rates in the entire state, so it’s vitally important to attract and then retain talented hospital personnel. So, it disturbs me profoundly when I hear and see what is becoming of our community hospital.

There’s always been a healthy tension between hospital administration and staff physicians and that’s been a good thing. In the past that has led to dialogue, compromise, and in the long run, improvement in healthcare delivery. There was a shared, mutual respect. Not so any longer! Healthcare locally and nationally was already on the road to becoming big business in 2011 when RMH became part of Sentara, but with that partnership really, really big business came to town with a corporate mentality that unilaterally decides and blatantly disregards input from the very people who make this hospital great. Continue reading

Biggest U.S. Orthopedic Facility Projects Exclude Virginia

by James C. Sherlock

Beckers just published a list of the 14 largest orthopedic projects in America in 2021. None of them are located in Virginia. Virginia’s COPN law and its administration make such projects highly unlikely here.

Every Virginia hospital that did not propose such a project would oppose it. And in the monopolized metro areas, why spend the money? They have a captive audience.

For reference, not one hospital in Virginia is rated among the 50 in orthopedics by U.S. News and World Report using its methodology. Only three of the 14 orthopedics projects listed by Beckers are in states that regulate such projects, two in New York and one in Alabama. Continue reading

New COVID Data Dump

Source: Virginia Hospital and Healthcare Association

by James A. Bacon

New Virginia Hospital & Healthcare Association (VHHA) data shows the impact of Governor Ralph Northam’s executive order banning elective surgeries last year. Hospital discharges across Virginia plunged from nearly 17,000 per week when the first COVID-19 cases were reported in the state to less than 12,000 — a drop of 31%. Then, after the ban was lifted, discharges rose to about 15,000 per week and stayed at that level — significantly lower than in previous years.

The discharge data, reported yesterday in a  VHHA report, “COVID Hospitalization & ED Visit Trends,” includes both elective and non-elective inpatient hospitalizations.

The freefall in elective procedures cannot be attributed entirely to Northam’s executive order, issued from a fear that the epidemic might overwhelm hospitals with COVID-19 patients. Many hospitals began restricting discretionary procedures before the governor issued the edict, and many patients chose voluntarily to delay procedures for fear of exposing themselves to the virus in a healthcare facility. Continue reading

A Cautionary Tale of Rural Healthcare and a Peek Inside a Health System Board Meeting

by James C. Sherlock

Revised 12 April at 1:34 PM

I ran across a fascinating story buried deep in a massive Centers for Medicare/Medicaid Services (CMS) database on Ambulatory Surgical Center (ASC) inspection reports.

The report I will share with you is a cautionary tale both of rural healthcare and of the way hospitals view and treat ASCs, even when they own them. The ASC in this case is in Virginia, the hospital that owns it is in West Virginia.

Nobody told the Virginia Department of Health or Medicare, which license and certify it respectively. This is the story of a VDH surprise inspection at the end of November 2020.  It was indeed a surprise – to the inspectors.  The ASC was closed, and had been closed a long time.

But it revealed a great deal about rural hospitals, ASCs and the business calculations of integrated health systems.

It also revealed that antitrust law is not always in the forefront of the decision trees of the boards of non-profit health systems.

Continue reading

COPN Drives Richmond’s Tuckahoe Orthopedics to Be Acquired to Survive

Bon Secours’ St. Mary’s Hospital, in the same medical complex as Tuckahoe Orthopaedics.

by James C. Sherlock

This is pretty straightforward.

COPN is driving a physician shortage in Virginia because doctors are not granted the independence to practice the way they want to with the facilities and equipment they need and that in turn is depressing their incomes. Reversing Robin Hood, COPN takes from the physicians and gives to the hospitals.

I offer in this essay a direct example.

Pre-COVID projection physician shortages in Virginia

The Medical Society of Virginia is of the opinion that: 

“Virginia’s COPN has failed to improve access, control costs, and ensure quality. … COPN laws prevent private health care providers from competing with larger providers to bring patients the same service at a lower cost in a more convenient location.”

A story yesterday in the Richmond Times Dispatch announced that Richmond-based Tuckahoe Orthopedics is getting a new owner, Bon Secours. Bon Secours operates five hospitals in the Richmond area.

Continue reading

Sentara CEO Kern Among 10 Highest Paid Nonprofit Executives in America

Sentara CEO Howard Kern

by James C. Sherlock

Sentara CEO Howard Kern is well paid. We will compare his compensation to those of the highest paid non-profit CEOs in the nation and to the CEO of the largest for-profit healthcare system in the country. Turns out he is extremely well paid.  

We should all have his agent.  

Many are unlikely to have thought about it, but non-profits have no stockholders and their boards officially work for the public. As citizens, we may wish for a better board at Sentara, but there is no mechanism for removing them except by government action.  

That is worthy of consideration by the government of Virginia.

Nonprofit CEO compensation comparisons. I examined a survey that listed the ten highest paid nonprofit CEOs of 2019.  Seven of those ten were healthcare CEO’s. The compensation packages of those seven ranged between almost $26 million and $8.3 million. 

Mr. Kern’s compensation package was reported as $8,053,745 on Sentara Healthcare’s IRS Form 990. But Mr. Kern’s 2019 compensation did not really miss the cut overall.If they had known the numbers when it was conducted, that survey team would have listed him as the tenth highest paid non-profit executive in AmericaContinue reading